The Department of Industry, Science, Energy and Resources has launched a set of principles to guide agreements between car dealers and manufacturers to improve transparency and fairness.
The Department said the principles, Best practice principles for new car dealership agreements, aimed to improve transparency and fairness in the development of future automotive dealer agreements to make the system fairer for consumers, dealers, and manufacturers.
“The principles, developed in consultation with the industry, are in line with existing obligations, rather than creating new obligations,” the Department said.
“The Government believes that the voluntary guide represents a sensible and balanced approach,” it said.
“The principles should be considered best practice when developing new dealership agreements.”
The Department said the principals covered compensation for franchisees in the event of early termination; compensation in new dealership agreements; allowances for the loss a franchisee may incur; return on investments; vehicle inventory; and commercial settlement and dispute resolution.
Minister for Industry, Science and Technology, Karen Andrews said the principles built on the introduction of a separate schedule to the Franchising Code of Conduct for the auto industry on 1 June this year.
“Those reforms were the biggest for the industry in years and included extending the notice needed to terminate agreements, as well as regulations to improve transparency and communication,” Mrs Andrews said.
The Department’s principles for new car dealership agreements can be accessed on its website at this PS News link.
